Nicotinamide cofactor dependent enzymes are increasingly finding use for the synthesis of chiral intermediates for the production of pharmaceuticals. With the increased availability of various oxidoreductases (BioCatalytics, Inc. 2003 catalog, see appendix), and the work on existing processes using amino acid dehydrogenases and alcohol dehydrogenases to make non-natural amino acids and chiral alcohols, the demands for ever more efficient and cost-effective methods for nicotinamide cofactor are increasing. Given the high cost of nicotinamide cofactors (current bulk prices are $1500/mole for NAD+; $5000/mole for NADP+), it is necessary to regenerate them using a suitable recycling system. Currently, glucose dehydrogenase is used for the recycling of NADP+. In this process, glucose must be fed as the reaction proceeds, and the byproduct, gluconic acid, is produced in equimolar quantities and must be separated from the desired product. The reaction also generates 1 mole of H+ ions per mole of product, necessitating pH control of the reaction mixture. For the recycling of NAD+, formate dehydrogenase is used. We have successfully implemented a commercial process for the production of a non-naturally occurring amino acid by coupling formate dehydrogenase with an amino acid dehydrogenase. This process is limited by the lower activity and long-term stability of formate dehydrogenase relative to the amino acid dehydrogenase, and product inhibition of formate dehydrogenase by NADH. Improving these characteristics would both significantly improve the economics of the existing process and increase the opportunities for additional applications in similar processes. In Phase II we plan to continue with the directed evolution of improved formate dehydrogenases for both NADP+ and NAD+ recycling. Work on an improved mutant for NADP+ recycling will focus on generating new mutant enzymes with increased specific activity, improved thermostability, lower KM, and reduced inhibition by NADPH. Evolution of formate dehydrogenase for NAD+ recycling will focus on further improvements in specific activity, reduced product inhibition by NADH, and greater thermostability. We will search for the new mutants using error-prone PCR and carry out saturation mutagenesis at all sites found to lead to improved enzymes to optimize the existing mutants. By the end of Phase II, we plan to have two new products: the first industrially-useful formate dehydrogenase for NADP+ recycling and an engineered FDH for NAD+ recycling that displays the higher specific activity, lower product inhibition, and greater thermostability than any existing formate dehydrogenase.